Employees who produce the paper’s editorial page and sports coverage will be heavily hit by the layoffs, and The Daily will run skeletal versions of those sections from now on. (Update: There won’t be a freestanding editorial section at all, the Daily says (below).) But the cuts will affect other parts of The Daily, including its design and production staff.

News Corp. officials have publicly defended The Daily, which News Corp. CEO Rupert Murdoch thought would serve as a template for newspapers’ transition to the tablet era. Murdoch’s team worked closely with Apple and its late CEO Steve Jobs to produce a publication initially tailored for the iPad.

But while Daily executives say they now have more than 100,000 paying subscribers for its iOS and Android editions, the paper hasn’t been able to live up to Murdoch’s expectations, and the money-losing publication has been under scrutiny since launch.

Earlier this month, following reports that News Corp. was considering shutting The Daily down, Editor-in-Chief Jesse Angelo told his staff to ignore “the haters.” But in a memo, he suggested changes were coming:

This is the truth about the modern media business — all outlets, including the ones writing about us, are under pressure to prove themselves as businesses. We are no exception, and to be sure, we will need to continue to evolve, adapt and change in order to compete and be successful.

The cuts come at the same time as News Corp. examines costs at other properties in its newspaper portfolio, in advance of its corporate divorce. News Corp.’s flagship Dow Jones unit, which publishes The Wall Street Journal, has quietly been letting go of some of its business executives; last month, Dow Jones shuttered the print edition of its SmartMoney personal finance magazine.

In addition to the layoffs, The Daily will try to save money in other ways. For instance, it will no longer create digital pages that work in both vertical and horizontal layouts, and will produce only vertical pages from now on.

But people familiar with the paper’s plans say it isn’t changing other parts of its strategy, including a recent move to produce a weekend edition.

New York, NY, July 31, 2012 – The Daily, News Corp’s daily national news publication built exclusively for tablets and touchscreen devices, today announced content and personnel changes at the publication designed to streamline its production, focus resources on its most popular features, and reflect the changing business environment for news and media.

The implemented changes to The Daily include the following:

Ø A total of 50 full-time employees, 29 percent of the full-time staff, will be released.

Ø The Sports and Opinion sections, which saw the lightest traffic, are being reorganized. Sports reporting will now be provided by content partners, like Fox Sports, while existing features like photo galleries and the ability to track favorite teams via a customizable sports page will remain. The Daily will no longer have a standalone Opinion section. Opinion pieces and editorials will appear in the news pages, clearly marked, from time to time as appropriate.

Ø The Daily will move to a portrait-only orientation – the mode in which the vast majority of its readers view content – though video will still be viewable in landscape mode.

Ø The Daily will continue to invest in the content its readers use the most: original reporting, strong visual elements, great photography and video, award-winning design, infographics, and interactivity. These are the features that continue to make The Daily unique and that have seen heaviest traffic; they will make up a greater percentage of each edition going forward.

“These are important changes that will allow The Daily to be more nimble editorially and to focus on the elements that our readers have told us through their consumption that they like and want,” said Editor-in-Chief Jesse Angelo. “Unfortunately, these changes have forced us to make difficult decisions and to say goodbye to some colleagues who have worked hard to make The Daily successful. These moves were driven by the needs of the business. The Daily is the first of its kind, and it remains the best of its class. We are still in the infancy of this innovative new media platform, but we have delivered excellent content, steadily increasing readership, quality reporting, and award-winning design. Our standards will not diminish as we move forward, nor will our enthusiasm for creating an outstanding daily digital publication.”

“We continue to believe in the future of tablet publications because we know the market for tablets and touchscreen devices will only expand,” said Publisher Greg Clayman. “As more and more people buy and use tablets in their daily lives, The Daily will grow with them. We have consistently remained one of the top-ranked paid news apps since our launch, we have steadily grown our subscriber base, and we have the world’s largest media and publishing company behind us. Like all good digital products, however, we must change and evolve to remain fresh, competitive and sustainable.”

And for good measure, a quote from News Corp.:

The changes announced today at The Daily will enable the business to operate more efficiently and with even greater focus on the types of content that consumers have gravitated towards since its launch. News Corporation remains committed to The Daily, and the publication will continue to be an important part of our leading portfolio of publishing brands going forward.

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